How to Get Out of a Contract With an Alarm Company

By Jayne Thompson - Updated November 04, 2018
home alarm system

Breaking up is hard to do, as the cliché goes. When it comes to breaking up with an alarm company, things get even harder. Most alarm companies require you to sign a multiyear contract, and most multiyear contracts are set up to auto-renew at the end of the agreed period. If you miss the short window for cancellation, you could be stuck with another year of services you do not want.

Tip

Generally, you can get out of an alarm contract by writing a simple termination letter. It's critical you send it at the right time, however, or your contract may auto-renew.

Three Days to Change your Mind

For the most part, remote monitoring alarm contracts are covered by the Federal Trade Commission's three-day cooling off period rules. After the installation has been completed, you have three days to back out of the contract and change your mind without penalty. The alarm company should give you two copies of a cancellation form along with your contract. Exercise your right to cancel by signing and dating one copy of the form and mailing it to the address given for cancellations.

Check the Cancellation Clause

If you decide to cancel outside of the first three days, you'll need to check your contract. Most alarm contracts have an auto-renewal clause that kicks in if you do not cancel the contract in writing within a specified period before the term ends. So, even if you signed a 12-month contract, you could be stuck with another year if you don't terminate quickly enough. The cancellation window can be as early as three months before the expiration date, so do look carefully at your agreement. How much notice do you have to give in order for the contract to not automatically renew? Be sure to send your termination letter before the final date.

Check the Penalties for Termination

Some contracts allow you to cancel the service before the end of the contract period, but at a cost. If you're wondering how to get out of an ADT contract, for example, be aware that you may have to pay a large percentage of the remaining contract fees if you cancel before the term of your contract is up. Before you do anything, consider whether it's better to wait until the end of your contract before terminating. You can call ADT to find out the cancellation policy specific to your contract, or review your contract documents.

Check Who Owns the Equipment

You might own the alarm equipment or the alarm company might own it. It depends on the terms of the agreement. If the equipment isn't yours, the alarm company may disable your system by changing the sensors or installer codes. In practical terms, this means that you'll have to pay substantial setup fees to activate the system again. Before you terminate the current contract, speak to your new provider about its ability to take over your existing alarm system and any fees you're liable for if the system needs a factory reset.

Write a Termination Notice

With all these ducks in a row, you can now write a letter to cancel your alarm contract. Be sure to include the following information:

  • The date
  • Your contract or service number
  • An expression of your desire to cancel the contract
  • Your signature
  • Any other information specified in the cancellation clause
  • The penalty fee if you are terminating early

Save a copy of your letter, then mail it using a certified mail service that requires a signature confirmation or other proof that the alarm company received your letter. This will stop the alarm company from claiming that you did not give the proper notice. Be sure to send the letter with enough time to cancel the contract before it automatically renews.

About the Author

Jayne Thompson earned an LLB in Law and Business Administration from the University of Birmingham and an LLM in International Law from the University of East London. She practiced in various “big law” firms before launching a career as a commercial writer. Her work has appeared on numerous legal blogs including Quittance, Upcounsel and Medical Negligence Experts. Find her at www.whiterosecopywriting.com.

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